MKS now expects a GAAP net loss per basic share of $0.23-to-$0.20, versus net income per diluted share of $0.01 to $0.09. The expected loss includes special charges of approximately $10 million, or $0.17 per share, related to the impairment of intangible assets, and excess and obsolete inventory that were not anticipated in previous guidance.

"During the third and fourth quarter, we implemented a 10 percent global workforce reduction and reduced our operating expenses, including reductions in discretionary spending, salary reductions for executive officers, and reduced fees for board members,'' said
Leo Berlinghieri, chief executive and president, in a statement.

"In these uncertain and challenging times, we will continue to take actions that have an immediate effect on reducing costs, such as taking mandatory time off, curtailing non-critical spending and temporarily reducing other costs,'' he said.

''Excluding these temporary cost reductions, our goal is to reduce our quarterly spending by $5 million exiting the second quarter of 2009. We plan to take a series of actions during the first and second quarters of 2009, which are expected to lower our non-GAAP operating breakeven level to approximately $123 million and our operating cash breakeven to approximately $108 million,'' he added.

It's a bad time in the market. Semiconductor equipment spending is projected to decline 30.6 percent in 2008 and another 31.7 percent in 2009, according to a revised forecast issued by market research firm Gartner Inc.

The market for semiconductor capital equipment will decline by nearly 28 percent in 2008 and another 21 percent in 2009, according to a year-end forecast released by the SEMI trade group.

Following a 24 percent decline in 2008, revenue from IC equipment sales is expected to drop an additional 25 percent in 2009, according to VLSI Research Inc. VLSI had previously predicted a decline of 12 percent in 2009.

Indeed, times are bad in the sector, which faces another downturn. Capital spending has grinded to a halt. Applied, Axcelis, Cognex, Entegris, FSI, Intevac, KLA-Tencor, Lam, Mattson, Micronic, SemiTool, Tegal and other fab-tool makers have recently announced layoffs.